Home / Business and Economy / Nvidia's $4 Trillion Milestone Fuels AI Boom Debate
Nvidia's $4 Trillion Milestone Fuels AI Boom Debate
26 Aug
Summary
- Nvidia surges over 30% in 2025, becoming first $4 trillion company
- Investors betting on AI's continued dominance in coming years
- Nvidia's earnings report seen as crucial indicator for tech sector
As of August 26th, 2025, Nvidia, the world's most valuable public company, has surged by more than 30% this year, becoming the first group to reach $4 trillion in market value. This meteoric rise has made Nvidia a significant contributor to the S&P 500's 9% gain in 2025.
Investors are placing their faith in the continued enthusiasm surrounding rapid advancements in artificial intelligence (AI), which has also boosted companies such as Microsoft, Amazon, and Palantir. However, this optimism is being put to the test as Nvidia prepares to unveil its highly anticipated quarterly earnings report on Wednesday.
The tech-heavy Nasdaq 100 index is currently trading at about 28 times expected earnings over the next year, well above the 25-year average of 22 times. Nvidia itself is trading at around 40 times its expected earnings, raising concerns over the lofty valuations of AI-related companies. Recent reports and comments from industry leaders have cast doubt on the sector's months-long surge, adding to the scrutiny surrounding Nvidia's performance.
